Nevada Iron (ASX: NVI) has discovered a zone of very high grade magnetite mineralisation on the South Central deposit’s southern contact, which has yielded impressive grades of up to 59.6% total iron from drilling.
A very high grade intercept of 13.7 metres at 59.6% from within a broader interval of 60.9 metres at 32.7% total iron was the highlight of drilling at the South Central deposit that forms part of the Buena Vista Project in Nevada.
The drill hole was terminated by a dyke and it is not known whether this dyke was intruded along an existing fault structure.
Drilling at the South Central deposit was designed to provide further QA/QC data for the impending resource re-estimation, infill data gaps on the geological cross-sections and reconfirm the mineralisation intersected in the historical diamond holes drilled by US Steel.
Better intersections from three diamond drill holes include 41.2 metres at 24% total iron from 6.1 metres (NBV-10), 60.9 metres at 32.7% total iron from 91.5 metres (NBV-11) and 6.3 metres at 28.1% total iron from 28.5 metres (NBV-12).
Drill hole NBV-12, located 61 metres east of NBV-11 but drilled at a steeper angle, may have stopped short of the massive magnetite mineralisation, with the bottom 1.3 metres of the hole assaying 32.3% total iron.
Drill hole NBV-10 contained a cumulative total of 112.9 metres of magnetite mineralisation from 6.1 metres depth, with 41.2 metres at 24% total iron from this depth indicating the potential for near surface mineralisation of potentially economic grades.
Remodelling of the historical data from the South Central deposit completed in December 2011, suggested that the previously interpreted tight, overturned syncline to the south of the deposit could more readily be explained by a major fault.
This sub-vertical fault could be traced continuously from Section 2800 in the west to Section 3600 in the east and abruptly terminates mineralisation to the south.
None of the three diamond holes drilled in July 2012 intersected the interpreted terminating fault to the south.
Resource upgrade
Today’s results bode well for a resource upgrade in the near future, adding to previous high grade intercepts of 10.7 metres at 53% total iron.
Currently the defined resource is 100.2 million tonnes at 20.3% total iron, hosted within the West Deposit.
Based on the confirmation of substantial geophysical targets at the Fisk and Ute prospects, considerable exploration upside exists at Buena Vista.
The project’s currently identified exploration targets provide for an additional 195 to 268 million tonnes of exploration potential.
Mineralisation has proven to be significantly different to other magnetite mineralisation in that the iron readily upgrades without the need for fine grinding.
Nevada Iron’s metallurgical test work is proving that even low grade Buena Vista ore upgrades, at a significantly coarser grind than typical banded iron formation (taconite) magnetite ore, to produce high quality clean concentrate grading 67.5 to 69% iron.
Analysis
There are significant catalysts and milestones ahead for Nevada Iron to move the current valuation. Results like today's high grade mineralisation will assist this for investors.
As Always DYOR
NVI Price at posting:
$1.08 Sentiment: LT Buy Disclosure: Held
